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By Joshua Dvorkin

The federal government will abolish the Millennium Scholarship and replace it with a new system of income-based grants, Finance Minister Jim Flaherty announced in last week’s budget.

Starting in 2009, the government will allocate $350 million to the new program, which will be available to 245,000 college and undergraduate students.

“[This] marks the end of Canada’s tenure as one of the few industrialized nations without a national system of grants,” said Amanda Aziz, National Chairperson for the Canadian Federation of Students, a student advocacy group.

Under the Millennium Scholarship, money is handed out based on academic achievement, community involvement and financial need.

The new system will be based solely on income. Under the new system, students from low-income families will receive $250 per month over an eight-month period, and middle-class students will receive $100 per month.

“This is a major victory for students. We finally have a national system of grants. It’s also great that this change came out of the dissolution of the Millennium Scholarship Foundation,” said Nora Loreto, president of the Ryerson Students’ Union.

Loreto and other student activists have been pushing the government to scrap the scholarships in favour of grants based on income, for a long time. Not everyone, however, is a fan of the new system.

Zack Churchill, national director for the Canadian Alliance of Student Associations (CASA), the country’s second largest student organization, points out that the new system has only been budgeted until 2013.

“[It] only indicates a short-term vision for students,” he said.

CASA was disappointed that the government decided to scrap the Millennium Scholarship, which was first introduced in 1998. Churchill, however, is happy that the Tories are willing to help students.

The budget will also assist students by injecting an additional $123 million over four years starting in 2009-10 to update the Canada Student Loans Program. Registered Education Savings Plans will remain open, from 25 to 35 years, instead of the current average 21 years depending upon the plan.

The government will also create a new $25 million Canada Graduate Scholarship award for top doctoral students.

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